With companion Valerie Trierweiler at his side, Francois Hollande celebrates his election victory with supporters at the Place de la Bastille in Paris on May 6. Thomas Coex / Agence France-Presse

With vows to change the destiny of France and to end an era of austerity came Francois Hollande's stunning victory on May 6 as France's first Socialist president-elect in almost two decades.

The 57-year-old, who may bring in a new wave of change in Europe, has already caused a rethink in Brussels over what solutions will arise to fix the European debt crisis. It has also muddied prospects that the Germany-backed austerity compact will save the economy.

But in China, it is not his proposal of stimulus growth that is raising concerns. With the helm of France shifting from rightwing Nicolas Sarkozy to the left for the first time in 17 years, questions have been raised as to whether the change in power will lead Sino-French relations in a new direction.

Analysts expect a brief rough patch after Hollande officially takes office on May 15, but have said that healthy and stable ties between the two countries will not change.

Ding Chun, director of the Center for European Studies of the Shanghai-based Fudan University, says France's foreign policy toward China is expected to experience some bumps in the road after the Socialist party come to power.

"But due to the stagnation in France and China's growing political and economic influence as the world's second-largest economy, uncertainty over bilateral relations will not last long. Hollande will need China on his side if he wants to bring a real change to the French economy," Ding says.

With Sarkozy gone, the challenges of getting France's near-zero economic growth back on track loom over Hollande. France, which lost its triple A rating this year, is burdened by public debt of around 1.7 trillion euros and a 10-percent unemployment rate. Keeping France's deficit below 3 percent by 2013 - a requirement of the eurozone austerity compact - will also be a major challenge. The IMF has already forecast a deficit closer to 3.9 percent for France in 2013.

Most of Hollande's campaign objectives - such as a boost in welfare benefits at the start of the school year, an extra 60,000 teaching jobs, and a partial reversal of the retirement age from 62 to 60 years - involve extra spending.

Under such economic turmoil, finding the money to achieve these challenging targets are the top priorities for Hollande.

Though he took a stand against aid from China during the campaign because he thinks the support will affect the sovereignty of France, experts suggest it is highly unlikely for France to solve its financial problems and for Hollande to keep his promises without the support from external markets outside the eurozone.

Cui Hongjian, director of European Studies with the China Institute of International Studies, says the economies in the eurozone are interdependent. The eurozone's economy is currently suffering with several countries in southern Europe sinking into recession after harsh deficit cuts.

Two major public worries are how the deep reforms will pan out amid Hollande's stimulus plan and how will he renegotiate the austerity compact with German Chancellor Angela Merkel. There is no hope, however, that Merkel will agree to rewrite the compact. On the other hand, if she does agree to amend the compact, where will Hollande find the money to stimulate growth?

Jose Manuel Barroso, president of the European Commission, said on May 8 that the European Council has called for an approval of project bonds, meaning that a contribution of 230 million euros ($298 million) from the current EU budget would be used to attract funding of up to 4.6 billion euros over the next two years for key infrastructure projects.

Barroso also mentioned that he would like to see a proposal to increase the European Investment Bank's lending capacity by at least 10 billion euros to be approved by the next European Council. Even if the funding Barroso wants is in position, it's doubtful whether it can help solve all of the problems in Europe and France.

With China rebalancing its economy from manufacturing and exports to domestic consumption, France can benefit by cooperating with China. France will need China's investments and its consumer market, Cui says. French exports to China in 2011 totaled $18.68 billion (14.4 billion euros).

Though France's trade deficit with China was around $15.64 billion in 2011, Cui says there was a 3.9-percent year-on-year decrease in the deficit and China is France's fastest growing export market with a growth rate of 28.8 percent last year.

But the positive trade trends didn't stop Hollande during his campaign from claiming China the bane of France's trade deficit. He proposed that the European Union increase its taxes on imports from China.

Experts, however, do not see the tough talk as a dangerous sign of possible changes in bilateral relations between China and France, but instead as token gestures from Hollande's Socialist stance.

Compared with Sarkozy, Hollande's Socialist identity pivots his foreign policies around protectionism, which could trigger trade conflicts in the short term, says Feng Zhongping, director of the Institute of European Studies at the China Institutes of Contemporary International Relations.

Feng says a smooth transfer from Sarkozy's rightwing stance to Hollande's center-left position may be too much to ask in the short term due to Hollande's lack of experience in diplomacy.

"He hasn't been to China before and it will take some time for him to work out clear foreign policies toward China and the Chinese government also needs to adapt to his governing style. So a short run-in period may not be avoidable," Feng says.

But in the long run, Hollande will likely not make abrupt decisions to damage bilateral relations between the two sides.

"He has a calm and practical personality. He will ponder every decision he makes," Feng says.

Positive signals have already been seen after Hollande chose to meet Kong Quan, the Chinese ambassador to France, on May 7 before meeting with any other ambassador.

According to Xinhua News Agency, the French president-elect vowed to further Sino-French cooperation and said France recognizes China's important influence over international politics and economy. He said he would like to see ties develop in a friendly and cooperative manner.

But the strengthening of Sino-French ties is not only about how France needs China's support.

For David Gosset, director of the Academia Sinica Europaea at China Europe International Business School (CEIBS), Shanghai, Beijing & Accra; and founder of the Euro-China Forum, countries such as China and the United States, which is facing a crucial election year, will also rely on Hollande to work out a better way to solve the European debt crisis and maintain a steady global economic outlook.

Gosset says that up until now the austerity measures have not really worked. "Something needs to be tried, and he is able to push for this new momentum. The good news for Hollande and the EU is that both the US and China want to see a success in the eurozone," he says.

mengjing@chinadaily.com.cn

(China Daily 05/11/2012 page3)